Temco Mfg. Co. v. National Electric Ticket Register Co.

• Decision Date: 28 September 1928
• Docket Number: No. 6837.,6837.
• Citation: 33 F.2d 777
• Parties: TEMCO MFG. CO. v. NATIONAL ELECTRIC TICKET REGISTER CO.
• Court: U.S. District Court — Eastern District of Missouri

33 F.2d 777 (1928)

TEMCO MFG. CO. v. NATIONAL ELECTRIC TICKET REGISTER CO.

No. 6837.

District Court, E. D. Missouri, E. D.

September 28, 1928.

Hugh K. Wagner, of St. Louis, Mo., and E. W. Marshall, of New York City, for plaintiff.

Rodney Bedell and Luther Ely Smith, both of St. Louis, Mo., for defendant.

FARIS, District Judge.

This is an action in the usual form for the alleged infringement of claim 60 of the Meier and Sullivan patent, No. 1,039,167, and of claim 53 of the Swift and Reller patent, No. 1,160,669, each by assignment pending prosecution, the property of the plaintiff.

The defenses are, in addition to the conventional ones of noninfringement and invalidity of the Swift and Reller patent, laches and unclean hands. The defense of unclean hands is bottomed on the contention that this action has been brought and is being financed, prosecuted, and maintained by the Automatic Ticket Register Corporation, to which plaintiff has contracted, by an option agreement in escrow, to convey and assign one of the patents in suit, to wit, No. 1,160,669, and other patents not in suit, as soon as final judgment shall be rendered against the defendant herein, adjudging the validity of the patents as against the defendant.

The defense of laches is bottomed upon the allegations that (as the evidence fairly discloses) defendant has been making and selling the accused device since 1914; that it has sold some 5,000 machines, which are now in use by many different concerns throughout the country; that defendant has invested large sums in a factory and in machines, machinery, and dies for the manufacture of the accused device, all with plaintiff's knowledge, and that this action was not brought until the sixth day of October, 1924, more than 10 years after the beginning of the infringement complained of here.

In fairness, if it has any relevance, it may be said, in passing, that an action for infringement was begun in 1914 by plaintiff against defendant, for that defendant had infringed patent No. 1,039,167 by making a machine under the teachings of another patent which had issued to one W. L. Sullivan. This machine was abandoned by defendant in 1914, and defendant began making a different machine (the accused device) under still another patent, issued to said Sullivan. For this reason, that is, because the subject-matter of the former infringement suit was abandoned by defendant (and others, it may be), the first suit was dismissed by plaintiff in 1916, and was never reinstated.

I see but little relevance in this situation. The former suit was leveled against a different structure, made under a patent the teachings of which were different from those of the patent under which defendant made the accused device; at least, some of the witnesses say so, and their statements are not denied. Moreover, the Patent Office must have deemed there were differences, otherwise it would not, or should not, have issued the second patent to Sullivan, under which latter patent, as said, defendant made the accused device. I am unable to see, then, wherein the bringing of the first suit for infringement and its pendency for two years, at all, or to any extent, operates to cut down the total term of years of delay to sue, since, in the meantime, that is, during said term of two years, defendant was engaged in making the present accused device.

So, the facts remain, that for almost 10 years, if not more, defendant had been engaged in making and selling the alleged infringing devices, before this action was commenced. That the trial of the case was then not pushed for some 3½ years I do not at all consider, because such consideration would necessitate a careful examination of the record in order to ascertain whether delays pending prosecution are attributable to defendant, or whether they are attributable to plaintiff.

Has plaintiff been guilty, under these facts, of such laches as to absolutely preclude the maintenance of this action? I think it has. It is, of course, difficult to apply any fixed statute of limitations to a suit for the infringement of a patent, however strictly such limitations may apply to an accounting thereunder for profits and damages. This is so because some one act or more of infringement may have occurred only a day before the action for infringement was commenced. Practically, infringement is ordinarily a continuing fact, or a continuing trespass on the rights of the patentee, which has been daily occurring; here, for example, since either January or October, 1914. Some of the witnesses (who are not contradicted) say that the making and selling of the accused device began in January, 1914. The patent issued to Sullivan, and under which the accused device was made, was applied for on October 26, 1914. So, from the latter fact there exists the presumption that there had been a reduction to practice as early, at least, as the date of application. But I have no doubt that, other things being present, laches may be imputed to a plaintiff who, with knowledge of infringement, stands by for many years and permits the alleged infringer to build up, at great expense, a large business, which will be worthless if plaintiff's complaint shall succeed, and who by inaction permits many thousands of other persons to become liable as constructive infringers from the fact of the use of an infringing device. Of course, laches does not depend on mere lapse of time. It is probably true that mere failure to sue for any but the latest act of infringement, which took place, perhaps, only the day before the suit was filed, would not of itself bar an action, on the ground either of laches or because of any statute of limitations, provided the action be brought during the life of the patent.

In passing, it may be said that state statutes of limitations in no wise control a federal court in an injunction suit for the infringement of a patent. This is so well settled that the numerous citations upholding the view taken need not be set down. Nothing is clearer, from the cases, than that courts are slow to apply the doctrine of laches in order to wholly bar an action to enjoin the infringement of a patent which has yet any substantial time to run. Largely, the reason is that infringement is, as forecast, a continuing trespass, so long as the infringement continues and the patent is in force. The application of the doctrine of laches is not bound by any statute of...